The World Bank's mission is to "help reduce poverty"?
What is Structural Adjustment?
Structural Adjustment Policies are given to countries to help them pay of loans and/ or qualify for loans from the IMF and the World Bank. SAP's are given to third world countries by the IMF and World Bank to help pay off there debt. However, there are many issues and controversies on how these policies affect the people of these countries. Although the debt of these countries are being payed off, the people suffer from malnutrition, starvation, and have a lifestyle that revolves around famine.
Essentially, Structural Adjustment is a term used to describe the changes in economic policies of a developing country, implemented by the International Monetary Fund and the World Bank. The policy changes are enforced to hopefully reduce the fiscal imbalances of the country. These policies are also for countries wanting to earn new loans from the IMF and World Bank, or to reduce interest rates on existing loans. The loans are designed to promote economic growth and to generate income. These conditions often subject these countries to free-market programs and policies. They open closed trade barriers allowing the country to import and export more goods, and also letting privatization into the country, In a nutshell, these programs provide low interest rate loans, financial and technical assistance, and interest free grants to countries.
The conditions of SAP's can be harmful to the population and the economy.
SAP's in Action
For example, countries like Niger are forced to devalue there currency and increase the price of goods within the country. The crops that once fed the population is too expensive for the people and instead is labelled as a "cash crop". The goods are being exported (not by will), and sold at a very high price to the people. This leads to famine because the majority of the population cannot afford to buy food at the new price. The underweight children grow smaller and smaller, unfortunately, much quicker then the debt. The government is content as this happens. The government denies that there's even a famine (specifically in Niger). It's clear that there is a famine but the government hates to admit that it's only happening because of the policies they created. While this horror takes place, Niger is praised for the economies policies.
Niger's Anguish
Niger's case is a tragic one. In 2005 there was a food crisis. out of 12 million people, 3.6 million went hungry and over 800,000 children were faced with starvation. It was the people that were paying the debt. They payed it with their health and lives at risk. They payed it off everytime they went soil fishing for something to eat. There was no agricultural problems. Same amount of produce was being grown just nobody could afford it.
Jamaica's Situation/ Life and Debt
A lot like Niger, Jamaica's fight for their freedom as a nation was difficult. After having full independance in 1962, Jamaica had a good decade of great economic growth. This came to an end and at that point the government welcomed the IMF and World Banks policies into their nation. When this happened, instead of helping the nations situation, it made things worse. The country had no money for education and health care, instead all the money was in the privatized business's such as Taco Bells and MacDonalds'. The currency drastically changed. The goal of reducing poverty was far from reach. The countries loans were at an interest rate of 25% per fiscal year. The once prosperous Bauxite and Alumina mines were forgotten. Jamaica's economy was crumbling. For what?
In hopes of restoring the countries strong economy the country was left in even more debt. 4.6 billion dollars in debt. The Structural Adjustment Policies failed and instead, did the opposite of what it was intended to do. It was implimented to reduce poverty but created even more.
The film Life and Debt shows an in depth look at how the austerity, deregulation, and privatization (as conditions of SAP's), deteriorated Jamaica's economy. It shows how well the IMF portrays neocolonialism and blackmailish tactics on having countries pay a never decreasing debt. It would be like reading a page of the bible per week, in hopes that you would finish it before you die. It's not going to happen.
Why us?
SAP's affect us on a global scale. It's the world government at stake. The IMF and the World Bank team together to create a global recession. We are affected everytime we walk into a grocery store and look at the produce. When we turn on the news. This all affects us because we are key players in making sure these policies work and not for the good of the countries who are victimized by them. We are all donors of these poor countries. Along with the United States and other powerful countries like the U.K. and Japan. We are all key players when we buy and sell and depend on money so much.
Money isn't what makes the world go 'round, but it's definitly what makes the world the way it is. It's what makes us rich or poor. It's what we use everyday and what we can't use everyday. It's a way of communication. We are always going to be affected when we live in one of the globes superpowers.
Structural Adjustment is colonialism. It's globalization. Instead of helping these countries, these countries are being forced into living by rules created by organizations.
by Phil Bottomley
The World Bank's mission is to "help reduce poverty"?
What is Structural Adjustment?
Structural Adjustment Policies are given to countries to help them pay of loans and/ or qualify for loans from the IMF and the World Bank. SAP's are given to third world countries by the IMF and World Bank to help pay off there debt. However, there are many issues and controversies on how these policies affect the people of these countries. Although the debt of these countries are being payed off, the people suffer from malnutrition, starvation, and have a lifestyle that revolves around famine.
Essentially, Structural Adjustment is a term used to describe the changes in economic policies of a developing country, implemented by the International Monetary Fund and the World Bank. The policy changes are enforced to hopefully reduce the fiscal imbalances of the country. These policies are also for countries wanting to earn new loans from the IMF and World Bank, or to reduce interest rates on existing loans. The loans are designed to promote economic growth and to generate income. These conditions often subject these countries to free-market programs and policies. They open closed trade barriers allowing the country to import and export more goods, and also letting privatization into the country, In a nutshell, these programs provide low interest rate loans, financial and technical assistance, and interest free grants to countries.
The conditions of SAP's can be harmful to the population and the economy.
SAP's in Action
For example, countries like Niger are forced to devalue there currency and increase the price of goods within the country. The crops that once fed the population is too expensive for the people and instead is labelled as a "cash crop". The goods are being exported (not by will), and sold at a very high price to the people. This leads to famine because the majority of the population cannot afford to buy food at the new price. The underweight children grow smaller and smaller, unfortunately, much quicker then the debt. The government is content as this happens. The government denies that there's even a famine (specifically in Niger). It's clear that there is a famine but the government hates to admit that it's only happening because of the policies they created. While this horror takes place, Niger is praised for the economies policies.
Niger's case is a tragic one. In 2005 there was a food crisis. out of 12 million people, 3.6 million went hungry and over 800,000 children were faced with starvation. It was the people that were paying the debt. They payed it with their health and lives at risk. They payed it off everytime they went soil fishing for something to eat. There was no agricultural problems. Same amount of produce was being grown just nobody could afford it.
Jamaica's Situation/ Life and Debt
A lot like Niger, Jamaica's fight for their freedom as a nation was difficult. After having full independance in 1962, Jamaica had a good decade of great economic growth. This came to an end and at that point the government welcomed the IMF and World Banks policies into their nation. When this happened, instead of helping the nations situation, it made things worse. The country had no money for education and health care, instead all the money was in the privatized business's such as Taco Bells and MacDonalds'. The currency drastically changed. The goal of reducing poverty was far from reach. The countries loans were at an interest rate of 25% per fiscal year. The once prosperous Bauxite and Alumina mines were forgotten. Jamaica's economy was crumbling. For what?
In hopes of restoring the countries strong economy the country was left in even more debt. 4.6 billion dollars in debt. The Structural Adjustment Policies failed and instead, did the opposite of what it was intended to do. It was implimented to reduce poverty but created even more.
The film Life and Debt shows an in depth look at how the austerity, deregulation, and privatization (as conditions of SAP's), deteriorated Jamaica's economy. It shows how well the IMF portrays neocolonialism and blackmailish tactics on having countries pay a never decreasing debt. It would be like reading a page of the bible per week, in hopes that you would finish it before you die. It's not going to happen.
Why us?
SAP's affect us on a global scale. It's the world government at stake. The IMF and the World Bank team together to create a global recession. We are affected everytime we walk into a grocery store and look at the produce. When we turn on the news. This all affects us because we are key players in making sure these policies work and not for the good of the countries who are victimized by them. We are all donors of these poor countries. Along with the United States and other powerful countries like the U.K. and Japan. We are all key players when we buy and sell and depend on money so much.
Money isn't what makes the world go 'round, but it's definitly what makes the world the way it is. It's what makes us rich or poor. It's what we use everyday and what we can't use everyday. It's a way of communication. We are always going to be affected when we live in one of the globes superpowers.
Structural Adjustment is colonialism. It's globalization. Instead of helping these countries, these countries are being forced into living by rules created by organizations.
Resources:
Notes on Niger: http://www.youtube.com/watch?v=Iw9OARpp-KI
Notes on Jamaica: http://en.wikipedia.org/wiki/Jamaica
Life and Debt notes and film
Other readings: http://en.wikipedia.org/wiki/Structural_adjustment
http://www.whirledbank.org/development/sap.html
http://www.globalissues.org/article/3/structural-adjustment-a-major-cause-of-poverty
And the beautiful mind of Philip John Bottomley.